DEFINING THE STRATEGIC FRAMEWORK
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A clearly stated vision:
Clearly articulated values:
A mission, articulated in a mission statement
The overall goal of the company
The immediate objective of the company
The key result areas on which the company intends to focus
An understanding of the gaps between where a company is and where it needs
to be to achieve its goals and objectives and of the forces that are likely to help
and hinder it.
All these elements need to be in alignment. This means that they should fit together
and complement one another, rather than contradict one another. So, for example, the
mission should with the values and vision of the company, and should address the needs
of the key stakeholders. The key result areas should, accumulatively, enable the
objectives and goals to be met, and should contribute to the fulfillment of the vision.
Assumptions that are made should be carefully considered in terms of their effect on
the ability of the company to make an impact. The consideration of gaps and opposing
and supporting forces should be done in relation to where the company is and what it
wants to achieve.
The strategic framework should give coherence and clarity to the work of the
company.
STRATEGIC PLANNING
In a diagrammatic form, the process of defining the strategic planning framework looks
like this:
VALUES
VISION
MISSION
OVERALL GOAL
DESIRED RESULTS
(Where the company
wants to be?)
IMMEDIATE OBJECTIVE
KEY RESULT AREAS
ACTION PLANNING
INTERNAL
IMPLICATIONS
VISION
The vision outlines what a company wants to be. It concentrates on the future. It is a
source of inspiration. It provides clear decision-making criteria.
The vision is the starting point for any strategic framework. It shapes the framework and
gives the company a basis on which to answer the following question:
Will this goal, objective or activity help us make a contribution to our vision?
VALUES
Your company values are the shared values that underpin the priorities and culture
within the business together with your relationships with users and other stakeholders.
They are what you believe is the right way to do things and to deal with people, and
how things should be organized. Your company values will determine your strategies
and your operational principles.
Clarifying and reaching consensus on your company values is very important because it
is this that provides a basis for you to make difficult decisions.
MISSION
Your mission includes the particular way in which your company intends to make a
contribution towards your vision.
A mission statement describes what the company does, with whom or for whom it does
it, and, in broad terms, how it does it.
So, a mission statement will have four components:
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What the company is;
What the company service or product aims to do or achieve;
Who the service or product is aimed at (the target group);
How it creates this service or product in broad terms, what methods it uses.
A mission statement if possible should give the geographical area in which the company
will operate.
A mission statement is important because:
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It is an easy way to communicate to others what you do and how you do it;
It helps you clarify and focus your business.
If any of the components change, then the mission statement needs to change as well.
That is why it is important to revisit your mission statement from time to time.
In the context of a strategic planning process, it is useful to introduce the mission
statement once you have clarified your vision and values, but you cannot finalise it until
you have reached an agreement on your overall goal and immediate objectives.
OVERALL GOAL (STRATEGIC DIRECTION)
The overall goals should define where the company is going and should be expressed as
broad statements of the desired results. This should include the strategic issues you
have identified as necessary to achieve the company’s vision.
Everything the company does should have the long-term aim of achieving those goals
(3-5 years). It is to this end that the company exists. These goals will cover issues such as
what the company needs to do in terms of positioning, resource allocation and
management attention.
This makes it clear where the company wants to be. The purpose of your strategy is to
get the company there or to make a significant contribution to getting it there.
You will know when the overall goals have been achieved, by setting indicators or signs
that are measurable.
IMMEDIATE OBJECTIVES (OUTCOMES)
Your immediate objectives develop the framework and basis for developing the other
key elements of your plan. They define the specific outcomes required to achieve the
company’s desired results.
Your immediate objectives need to be measurable. Once you have your immediate
objectives, then you have set the agenda of the company. You now need a strategy to
help you achieve the objectives and that is where your key result areas come in. In
order to achieve your immediate objectives, you need to achieve certain results that
will, together, lead to the positive situation you desire. By now you should be able to
see that there is a vertical (up/down) logic at work here:
Overall goals achieved
Immediate objectives achieved
Achieving the planned-for result areas
The strategy is aimed at contributing to the achievement of the overall goals by
achieving the immediate objectives. This vertical logic is how you think strategically,
answering the question:
What must we do, if this is what we want to achieve?
ACTION PLANNING
(OUTPUTS – OPERATIONAL PLAN)
This means identifying the tasks that need to be done in order to achieve the objectives.
The action plan records what must be done, the date by which it will be done, who will
be responsible for getting it done, and what resources will be needed to do it (money
and people).
A good action plan:
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Forces the company to decide how it intends to reach an objective.
Helps the company move beyond crisis managements to sensible planning and
use of resources.
Helps to resolve issues of sequence or the order in which things should be done.
Provides a basis for holding people accountable for what they do.
Provides a basis for measuring progress and doing a work progress review.
Provides a basis for job descriptions.
Provides a basis for budgeting.
Without an action plan, implementation is very difficult. Work tends to be confused and
uncoordinated. It is difficult to know who should have done what by when. Sometimes
things don’t get done and no-one notices until its too late.
A strategic framework is the skeleton of planning that results in impact. An action plan is
the hands that lead to efficient and effective implementation.
KEY RESULT AREAS
(OUTPUTS – ACTIVITIES)
Key result areas define the outputs that are needed to achieve the immediate objectives
of the company.
The key results should be written as output statements. This is to emphasize that as a
result of what the company does, an output will be achieved.
These result areas form the basis of the action planning that needs to take place. Many
activities will go into ensuring that the outputs occur.
The companies assumption is that, if it achieves the outputs specified as key result
areas, then the immediate objectives will be achieved. The further assumption is that
this will contribute towards the companies overall goals. The result areas spell out the
companies strategy for achieving the overall goals. The company does not yet know
whether or not the strategy will work. There are a number of elements and stages that
will need to be monitored in order to know this. They include:
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Monitoring that achieving the key results does lead to the immediate objective
being achieved.
Monitoring whether your achieving the immediate objectives makes a
difference to achieving the overall goals.
Why is it important to monitor this?
Strategies are not set in stone. If a particular strategy does not work, then it can, and
should, be changed. This makes monitoring and evaluation a very important part of a
planning cycle. That is why you need indicators for the successful achievement of your
overall goal and your immediate objectives.
INTERNAL IMPLICATIONS
Now you can look at the internal implications of your strategic plan. Once you have a
strategic plan, you are in a position to:
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Structure the company appropriately
Identify where specific change management will be required
Identify potential problems
Clarify where to next.
When considering these issues it is important to remember that form follows function.
By this we mean that you cannot decide how you should organize your business until
you have a clear idea of what the business is going to be.
STRUCTURE
Most companies have a structure that has both hierarchical and team elements. An
hierarchical structure is one in which people report to someone who has authority over
them, and who is accountable for ensuring that other people do their jobs properly.
Some companies are very hierarchical, with many levels, and others are flatter; so, for
example, there might be a director, but most other people would be on the same level.
This only works in fairly small companies. Other companies may decide not to be
hierarchical at all, with everyone in the company at the same level, and everyone
equally accountable for ensuring that work gets done. This can work in a small company
in which people have equal levels of skill and commitment, but it does not work when
people have different levels of skill and commitment.
Within a hierarchical company, it is still possible to work in teams. Teams can take
different forms. The most important thing to remember about teams is that they are
functional groups. Their reason for existing is to get a specific and clearly defined job
done. This may be determined by the strategic framework, or by specific jobs that need
to be managed. Each member of the team has a particular role, which complements (fits
together with) the role of other team members. The successful completion of the work
depends on the team members working together. Within organizations teams could
take the form of departments that specialize in different kinds of work.
All functional teams need leaders. If the people in the team are of roughly equal skill,
then it is probably enough to have a coordinator. That person is responsible for seeing
that the team meets and that everything is on track. If there are discrepancies in skill
and, possibly, commitment, then something more hierarchical, where the team leader
has authority, is needed. Team leadership is a way of developing confidence and skills in
people who have never thought of taking leadership positions. A team leader’s authority
does not cut across a line manager’s authority. The line manager is the person to whom
someone reports and who is accountable for his/her performance. Performance
problems that affect a team should be referred back to the line manager.
CHANGE MANAGEMENT
Your strategic planning process may result in some things in the company changing,
either in terms of the work done or in the internal structuring of the work. People
struggle with change. They may need help to accept and respond positively to change.
When change is needed, the following steps should be followed:
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Make sure everyone understands the change and why it is necessary. Even if
people have been part of the strategic planning process, they may need the
implications of decisions explained to them afterwards. Where the change
affects people outside the company, explain it to these stakeholders as well.
Respond to people’s ideas and feelings. Let them express their concerns and
respond to them. If you cannot agree, at least be empathetic about the feelings
that are generated by change.
Develop a planned process of change and share this with everyone within the
company so that people know what to expect and when to expect it.
Implement change.
Consult, support, and give feedback during the change process.
Acknowledge and celebrate successful change.
THE SWOT ANALYSIS
Purpose: To identify the internal strengths and weaknesses of a company and the
external opportunities and threats the company face.
The best time to use a SWOT Analysis is after you review progress and after you have
done some sort of environmental scan.
SWOT stands for:
S = Strengths
W = Weaknesses
O = Opportunities
T = Threats
Strengths and weaknesses are factors that are internal to the company and can be
addressed within the company. Opportunities and threats are external to the company
and provide challenges to the company.
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What are our strengths?
What are our weaknesses?
What are the opportunities facing us?
What are the threats facing us?
You should end up with something that can be transferred into the following format.
Strengths
Weaknesses
Opportunities
Threats
Discussion should include answering the following questions:
 What can we do to maximize our strengths?
 What must we build or develop to overcome weaknesses or problem areas?
 What do we need to do to make use of the opportunities?
 What can we do to minimize or neutralize threats
Prioritize your answers by asking these sorts of questions
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What is really important for our current and future work?
What is too serious to ignore?
Examples of SWOT’s
Strengths and weaknesses
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Resources: financial, intellectual, location
Cost advantages from proprietary know-how and/or location
Creativity (ability to develop new products)
Valuable intangible assets: intellectual capital
Competitive capabilities
Effective recruitment of talented individuals
Competitive advantage
Brand reputation
New product
Opportunities and threats
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Expansion or down-sizing of competitors
Market trends
Economic conditions
Expectations of stakeholders
Technology
Public expectations
All other activities or in-activities by competitors
Criticisms by outsiders
Changes in markets
All other environmental condition
Global influences